In this month’s GoForth Institute newsletter, we’re answering the question, what is microfinance?
Basically, microfinance (also called microcredit or microlending) is a way of providing credit, savings and general banking services to millions of entrepreneurs who may be lacking collateral or a good credit rating. Often, a person thinking of starting a small business just needs a bit of money to get started – to buy a computer, farming equipment or other supplies. They don’t need or want a loan for tens of thousands of dollars and, sometimes, they don’t have access to traditional sources of funding. In these cases, microfinance can help them start their small business on the best footing possible.
Read more about microfinance in our June newsletter, including why it’s often referred to as “liberation capital” and what some organizations are doing to support entrepreneurs through microfinance partnerships.